Facilitator fees are now free to use

In June 2015 Dwolla rolled out new pricing. We removed transaction fees and started offering value added features and controls to our business clients.

In these new packages we focus on making the banking system, and largely ach transfers, easier for developers and businesses to use.

When our new pricing was introduced we bucketed some older functionality and some new functionality. As a company, we made one decision in that process that we’d like to apologize for and make a change to.

The facilitator fee was moved into the $1500+ package as a paid feature and today we’re making it free again. While I could go into the rationale behind the original decision, it doesn’t matter and it just needs to change.

What matters now is making a fix and making sure budding developers, who are getting companies off the ground, can make use of the feature.

The facilitator fee does a few things well:

It allows developers to build fees into their applications.

It allows developers to charge a fixed fee or a percentage fee for any transaction passing through their application.

It allows developers to build software that leverages ACH transfers, Dwolla balance transfers, credit transfers, and anything else someone could use on the Dwolla platform to move money and charge an appropriate fee.

Fees might sound bad but a tremendous number of non-payment companies charge small fees to cover operational costs or as a part of the service they provide. Many times it’s not charged to the end user.

Here are a few places we’ve seen facilitator fees used successfully:

Some organizations have small service charges as a part of transactions. $2 for example on each transaction keeps their technical team staffed and kids getting lunch cards loaded on time.

Software developers building software for third-party companies can actually build their fee into each transaction rather than charging upfront. This helps more companies get to market without loaded up-front costs.

Software marketplaces where the marketplace may take 10% of the original purchase price for a service ordered. This has become more and more common. We help the marketplace split the payment as the money moves.

There are some other key benefits for businesses operationally with this structure:

When your software application takes a facilitator fee, your company account only receives the fee and you can route the rest of the money to the person receiving the transaction. This happens regardless of whether or not it’s a bank transfer, balance transfer or credit transfer.

When you only receive the fee and the other party gets the rest of the money directly, that means you’re never holding your customer’s money for the purpose of transmitting it to another party. That’s a positive thing!

In closing, we put Facilitator Fees into a package when it shouldn’t have been. This is a feature that wants to be free—you want it to be free and we’ve heard you loud and clear.

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Financial institutions play an important role in the Dwolla network.

Dwolla, Inc. is an agent of Veridian Credit Union and Compass Bank and all funds associated with your account in the Dwolla network are held in pooled accounts at Veridian Credit Union and Compass Bank. These funds are not eligible for individual insurance, including FDIC insurance and may not be eligible for share insurance by the National Credit Union Share Insurance Fund. Dwolla, Inc. is the operator of a software platform that communicates user instructions for funds transfers to Veridian Credit Union and Compass Bank.